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Harris v. Taylor

July 14, 2010

FREDDIE HARRIS, PLAINTIFF,
v.
JUSTIN A. TAYLOR, JONATHAN NOCERA, ALAN TAYLOR, DEFENDANTS.



The opinion of the court was delivered by: George H. Lowe, United States Magistrate Judge

ORDER and REPORT-RECOMMENDATION

This pro se prisoner civil rights action, commenced pursuant to 42 U.S.C. § 1983, has been referred to me for Report and Recommendation by the Honorable Lawrence E. Kahn, Senior United States District Judge, pursuant to 28 U.S.C. § 636(b) and Local Rule 72.3(c). Plaintiff Freddie Harris, an inmate in the custody of the New York Department of Correctional Services ("DOCS"), alleges that Defendants Justin Taylor and Jonathan Nocera violated his constitutional rights by confiscating and inspecting his outgoing mail to the Internal Revenue Service. He further alleges that Defendant Alan Taylor violated his constitutional rights when he conducted a disciplinary hearing on charges that Plaintiff attempted to file false tax returns. Currently pending before the Court is Plaintiff's motion for summary judgment pursuant to Federal Rule of Civil Procedure 56 (Dkt. No. 19) and Defendants' cross-motion for summary judgment (Dkt. No. 20). For the reasons that follow, I recommend that Plaintiff's motion be denied and Defendants' motion be granted.

I. FACTUAL AND PROCEDURAL SUMMARY

On April 21, 2008, Plaintiff wrote to the District Attorney of Kings County, asking him to prepare and file IRS form 1099OID reflecting an "appearance bond in the amount of $15,000,000." Plaintiff asserted that it was "mandatory" that the District Attorney file the form and that "if a response is not received . . . within [ten] days . . . it will be assumed that you have chosen to dishonor me." (Am. Compl., Dkt. No. 16 at 9-10.)

On May 5, 2008, Plaintiff wrote to the District Attorney again. He stated that the District Attorney was in "serious tax delinquency" because he had not responded to Plaintiff's previous letter. Plaintiff stated that if the District Attorney did not respond within five days, he would file his own 1099OID listing the District Attorney as "the originator of the eligible issue(s), the payer tax I.D. number as being 'refused'." (Dkt. No. 16 at 12-13.)

On May 15, 2008, the District Attorney's office responded that it had received Plaintiff's correspondence and was "unable to assist" Plaintiff. (Dkt. No. 16 at 14.)

In early 2008, the mailroom at Gouverneur Correctional Facility ("GCF"), where Plaintiff was then incarcerated, received an unusual amount of inmate mail addressed to the IRS. All of the mail was from different inmates, but each envelope was addressed with the same handwriting. Defendant Justin A. Taylor ("Taylor"), the superintendent of GCF, was informed of this fact and that a publication titled The American Bulletin was circulating in the prison. The American Bulletin advocated the filing of fraudulent tax returns by inmates as a form of protest. (Taylor Decl., Dkt. No. 20-3 ¶ 5.) Taylor was familiar with a similar scheme that had occurred earlier in his career at a different facility. (Taylor Decl. ¶ 6.)

Taylor contacted John Crowley, a New York State Department of Correctional Services ("DOCS") Inspector General Investigator. Crowley provided Taylor with details of a tax scheme at a different facility in which inmates claimed false withholding credits attributed to "appearance bonds." The inmates used IRS forms 1099INT, 1099OID, 1096, 1040, and letters to District Attorneys requesting an IRS filing based on their indictment number and social security number. The scheme Crowley described was nearly identical to the examples provided in The American Bulletin. (Taylor Decl. ¶ 8.)

Taylor believed that in order to investigate whether a similar scheme was taking place at GCF, he would need to open and review inmate mail addressed to the IRS. (Taylor Decl. ¶ 9.) Taylor reviewed DOCS Directive No. 4421, dated May 11, 2001. (Taylor Decl. ¶ 10.) Under Directive 4421, any correspondence by an inmate to a federal agency is classified as "privileged correspondence." Such correspondence "shall not be opened, inspected, or read without express written authorization from the facility superintendent." The superintendent "shall not authorize the reading of . . . privileged correspondence unless there is a reason to believe that . . . any applicable state or federal law has been violated, or that the content of such correspondence threatens the safety, security, or good order of a facility or the safety or well being of any person." The superintendent's authorization must be in writing and set forth the facts forming the basis for the action. The directive advises superintendents to consult with the DOCS office of counsel before issuing such an authorization. If, after reading the contents of privileged correspondence, there is reason to believe that, inter alia, federal law has been violated, the correspondence may be confiscated. If the correspondence is confiscated, the inmate must be given written notice unless doing so would be inconsistent with the need to safeguard an investigation. (Defs.' Ex. A, Dkt. No. 20-5.)

Taylor contacted DOCS Associate Counsel Thomas Goetz and explained the situation to him. Based on the facts Taylor gave him, Goetz advised that Taylor had sufficient reason to open and review the contents of the envelopes addressed to the IRS. (Taylor Decl. ¶ 12.) Thereafter, Taylor prepared an authorization to open the suspected envelopes. He personally opened the envelopes. The envelopes contained IRS forms 1099INT, 1099OID, 1096, 1040, and letters to District Attorneys requesting an IRS filing based on the inmates' indictment numbers and social security numbers. Each return sought an IRS refund in excess of several hundred thousand dollars. (Taylor Decl. ¶ 14.)

Taylor opened an envelope from Plaintiff addressed to the IRS. It contained a 1099OID form claiming that District Attorney Charles J. Hynes withheld a total of $15,000,000 in federal income tax as "holder in due course" for Plaintiff. It also included a 1096 form in which Plaintiff claimed $15,000,000 in income for 2008 as a result of an "appearance bond" and $4,200,000 in federal income tax had been withheld from his income in 2008. (Taylor Decl. ¶ 21.)

On January 22, 2008, Defendant Jonathan Nocera, an investigator in the DOCS Inspector General's office, was assigned to investigate the possible tax scheme at GCF. (Nocera Decl., Dkt. No. 20-2 ¶ 9.) As part of his investigation, he reviewed the mail to the IRS that Taylor had confiscated. Defendant Nocera found that all of the confiscated mail was "consistent with the tax scam advocated in The American Bulletin." (Nocera Decl. ¶ 11.) Based on conversations with Special Agent Kelly Ewald of the IRS Criminal Investigations Division, Nocera determined that the inmates' tax forms "had the hallmarks of a fraudulent tax return" and that they were "most likely part of a prison-based tax scam to defraud the Internal Revenue Service." (Nocera Decl. ¶ 12.)

Regarding Plaintiff's mail to the IRS, Nocera considered it to be part of a tax scam because (1) it demanded an excessive tax refund; (2) it lacked supporting documentation substantiating a tax refund in that amount; (3) Plaintiff had listed a private address rather than his current address as an inmate; and (4) Plaintiff had used tax forms 1099OID and 1096 to claim large withholding credits attributed to an appearance bond. (Nocera Decl. ¶ 13.) Plaintiff correctly notes that the assertion by Defendant Nocera regarding his return address is inaccurate. (Dkt. No. 22 at 7.) Plaintiff's envelope to the IRS listed GCF as his return address. (Defs.' Ex. C, Dkt. No. 20-7.)

On June 30, 2008, Taylor sent Plaintiff a letter informing him that his IRS forms had been confiscated. (Taylor Decl. ¶ 22.)

Over nine months later, on April 10, 2009, Defendant Nocera issued a misbehavior report charging Plaintiff with soliciting and making false and misleading statements. (Dkt. No. 16 at 15; Taylor Decl. ¶ 23; Nocera Decl. ¶ 16.) The report stated that "it was found that [Plaintiff] submitted a fraudulent U.S. Income Tax Return . . . This was done in an attempt to solicit the IRS for monies he was not entitled. [Plaintiff] admitted this during interview." (Dkt. No. 16 at 15.)

Defendant Alan Taylor ("A. Taylor") conducted a disciplinary hearing on April 16, 2009.

(Dkt. No. 20-10; Taylor Decl. ¶ 24; Nocera Decl. ¶ 17.) Plaintiff testified at the hearing. (Dkt. No. 20-10; Taylor Decl. ¶ 25.)*fn1 Defendant A. Taylor found Plaintiff guilty and sentenced him to four months in the Special Housing Unit ("SHU") and the loss of various privileges. (Taylor Decl. ¶ 26; Nocera Decl. ¶ 17.) In his written disposition, Defendant A. Taylor stated that the evidence he relied on was the misbehavior report and a statement that had been prepared by Defendant Nocera and signed by Plaintiff. (Dkt. No. 16 at 17.) Plaintiff appealed. The disposition was later reversed by Norman R. Bezio, the Director of the Special Housing/Inmate Disciplinary Program. (Dkt. No. 16 at 18; Dkt. No. 19-4 at 37.)

On June 11, 2009, Defendant Nocera completed his investigative summary report and concluded that fourteen inmates had attempted to file fraudulent tax returns. All fourteen inmates were found guilty of prison disciplinary charges. (Nocera Decl. ¶ 18.) All of the confiscated tax returns and tax forms were forwarded to the IRS' Criminal Investigative Division for further investigation and possible criminal prosecution. (Nocera Decl. ¶ 19.) A federal grand jury in this District later returned ...


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